(Adds details, comments; Updates prices)
* China gears up for Lunar New Year celebrations
* Silver set to post biggest weekly decline since early December
* Palladium, platinum on track to post worst week in five
By Diptendu Lahiri
Jan 24 (Reuters) - Gold edged down on Friday as the dollar rose and the appetite for riskier assets improved after the World Health Organisation tempered fears of a global coronavirus outbreak.
Spot gold XAU= was 0.3% lower at $1,557.93 per ounce by 1300 GMT but held above the key $1,550 level, supported by the prospect of easy monetary policy globally.
U.S. gold futures GCcv1 slipped 0.5% to $1557.50 per ounce.
"Gold prices are facing headwinds from gaining equities and a stronger dollar but it is unlikely to fall below $1,520 as a bunch of geo-political uncertainties still exist," Saxo Bank analyst Ole Hansen said.
European shares gained after the WHO designated the coronavirus outbreak an emergency for China but not yet for the rest of the world. MKTS/GLOB
However, the spread of the virus ahead of the Lunar New Year, a peak period of travel and gold demand in China, kept investor concerns heightened.
Furthermore, the dollar .DXY hovered close to a more than one and half month high against a basket of currencies, making gold expensive for buyers holding other currencies. USD/ a low interest rate environment, geopolitical risks and uncertainties such as U.S. President's impeachment, the conditions are still quite conducive to further upside in gold," ANZ analyst Daniel Hynes said. the European Central Bank left rates unchanged on Thursday, investors are looking to the U.S. Federal Reserve's first meeting of the year scheduled on Jan. 28-29.
However, in the short-term, "the Libya oil issue and the coronavirus have not helped (gold) much and if this continues, we might see a challenging quarter ahead," Saxo Bank's Hansen said.
Libya earlier this week declared force majeure on two major oilfields following a military blockade, and protests escalated in Iraq, pushing investors towards safe-haven assets. of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust GLD , rose 0.2% to 900.58 tonnes on Thursday. GOL/ETF
Elsewhere, palladium XPD= dipped 0.6% to $2,447.11 per ounce, and was on track to register its first weekly fall in five at about 1.3%.
Silver XAG= rose 0.2% to $17.82 per ounce but was set to post its biggest weekly decline since early-December at nearly 1%. Platinum XPT= rose 0.2% to $1,004.44, but was down 1.4% for the week, its worst since the week ended Dec. 20.